On-premise was about winning the deal, while cloud is about winning the user, he added. "We can't execute on our visions without our partners," said Huddleston. "That's why our ISV partner ecosystem will remain so important." But, he said, VARs and more traditional channel partners will also become increasingly important.

But what will customers want from cloud services providers and app providers? He noted that Pandora is a poster child for where the market is heading. First Pandora shifted entirely to the cloud and freed up half of its IT staff. Next, the company is integrating all of its back-end services for a great end-user experience. Somewhat similarly, Salesforce.com is hearing demand for Connected Customers, Connected Partners, Connected Employees -- and integration between all those areas. The channel, in turn, will deliver integrated experiences involving single sign-on, shared data across apps, social feed, mobile UI and upgrades.

"A third-party is incredibly well positioned to deliver on the vision" of integrated apps from multiple providers, he predicted.

The six characteristics of a great solution that provides value-add and a great end-user experience:

Collaboration

Mobility

Social UX (does your app prompt people to engage)

Network Effects (is your app more powerful as more people use it)?

Innovation: Are you transforming your niche?

Interoperability: Do you connect with other apps easily?

What are the give steps of building a successful cloud channel? He said:

Build an organization born for the cloud

Focus on customer and partner success

Ensure transparent cloud economics

Be the market maker

Develop a team of evangelists

He stressed again and again that cloud success involves a long-term mentality rather than a near-term profit motive. In the cloud, partners evolve from system integrator to VAR to ISV. It's a natural evolution, he said.